Many have touted the latest advances in location-based technology, but the news is mostly disappointing for marketers, advertisers and digital gurus.

Writing in the Times, Joshua Brustein pined: “Everything is in place for location-based social networking to be the next big thing. Tech companies are building the platforms, venture capitalists are providing the cash and marketers are eager to develop advertising. All that is missing are the people.”

Brustein’s piece cites a Pew Research Center finding that only 4% of Internet-using American adults have also used location-based services. Depending on who you are talking to, this is either stupendous news or a serious reality check.

For the multitudes who are mostly unaware of location-based services such as Foursquare, Gowalla and SCVNGR, the fact that millions of people are broadcasting their whereabouts to their social networks — a mix of online friends, acquaintances and strangers — must be astounding. I hear it all the time. "Why would people tell other people where they are? Isn’t it dangerous? I’ve seen people checking in at church and OB-GYN offices. Is there nothing sacred?"

And yet for those on the front lines of technology, marketing, branding and advertising, that 4% seems painfully low.

What’s Missing From the Location-Based Revolution?

In a word: Sales. The conversion aspect just isn’t there. There is a small subculture of early adopters, but if these services expect the mass adoption that is necessary to attract the attention of brands and advertisers, then the process needs to be simplified.

One untapped solution marketers should explore is integrating social networking — especially location-based checkins — with the point-of-sale systems many businesses already have in place.

As it stands now, if I walk into Gap and check in on Foursquare or Facebook Places, and I end up buying a pair of jeans and a sweater, Gap may know that I checked in. But their POS system is only aware of the sale, not the social profile of the buyer.

It's a missed opportunity: two disparate stars in their marketing universe, seemingly unconnected. Someone needs to build a shuttle connecting the two. Gap should know not only that I am in one of their stores, but who I am with, and how long it has been since I was last there. The logical extension of this is that Gap should know what I bought last time I was in. Then the store would be able to offer me specials, discounts or exactly what it is I came in to buy in the first place.

This is the holy grail of location-based marketing.

The Potential of Data-Driven Service

Once a retailer, restaurant or hotel makes this connection, it can offer the most relevant products as close to the point of sale as possible. After all, if you're already in a store, you're likely to make a purchase.

Let’s imagine a restaurant scenario.

There is a French bistro in downtown Manhattan that I frequent about once a month. Most of the staff know me, but I don’t have personal relationships with anyone in particular. I have a relationship with the restaurant itself. I check in on Foursquare, I leave reviews on Yelp, I tweet about people I see there or what I am eating. And if something interesting or terrible happens — seeing an Olsen twin for instance (both interesting and terrible) — I might write a blog post about it. This is on top of the normal offline conversations I might have with family and friends about the restaurant.

If the restaurant was aware of my physical presence there, in real time, the host would be able to see when I last visited, what I ordered, and how much I spent. Did I tweet about it? Did I enjoy a particular wine? Was the roast chicken undercooked?

Armed with this information, the restaurant could develop strategies to make my current experience even greater and turn an occasional customer into a loyal one — perhaps even a brand evangelist.

A host could thank me for coming back and apologize for the chicken, or offer a wine similar to the one I tweeted about enjoying so much. Perhaps after dinner on Saturday nights, I routinely go to a jazz club. The restaurant will know I'm a regular based on my Foursquare history and maybe it will co-market with that jazz venue to offer tickets to patrons like me. This would be small business community-building at its finest and realest.

They can discount me, up-sell me or offer me a value-add, but it will be so targeted, so relevant and so personal that I’ll hardly be able to refuse. Of course, it will take some time to establish what is appropriate and what isn’t, but this opens up a whole new world for strategists to discuss, test and develop into winning tactics.

Tasti D-Lite Is Leading the Way

As previously noted, Tasti D-Lite is the only national retailer that has integrated its loyalty program with location-based checkins. The problem for national retailers is that various locations often use different POS systems. The cost of synchronizing social POS across various platforms is onerous, particularly as the value prospect remains uncertain.

TastiRewards incentivizes customers to link their Twitter and Foursquare accounts to their Tasti D-Lite loyalty cards with the reward of additional loyalty points. Each time a customer checks in, a tweet is automatically sent out to his followers, earning the company a seemingly valuable brand mention.

More recently, Tasti D-Lite has started integrating branded iPad applications in several stores. Clearly this is a company committed to experimenting with new technology and social media. Its social technology officer, B.J. Emerson, has done a wonderful job promoting these initiatives.

Given what we've seen so far, I think that the integration of social location-aware apps into point of sale systems is inevitable, and it will be one of the greatest strides in bridging the gap between the online and offline marketing worlds.

What's Hot

More in Social Media

What's New

What's Rising

What's Hot

Mashable
is a leading source for news, information and resources for the Connected Generation. Mashable reports on the importance of digital innovation and how it empowers and inspires people around the world. Mashable's record 42 million unique visitors worldwide and 21 million social media followers are one of the most influential and engaged online communities. Founded in 2005, Mashable is headquartered in New York City with an office in San Francisco.